US President Donald Trump’s war with Iran was always unpopular at home. What made it tenable is that the American economy, buoyed by oil exports and an artificial-intelligence boom, ​seemed almost recession-proof. With the Strait of Hormuz still disrupted, however, even the world’s largest economy needs to reckon with ‌the possibility of a downturn.

Until recently, economic forecasts were relatively benign, especially for the United States. When the International Monetary Fund (IMF) updated its global projections earlier this month, its so-called baseline scenario still had world output expanding 3.1 percent this year. Only under its “severe scenario,” which assumed crude prices averaging $110 per barrel in 2026 and $125 in 2027, ​did the IMF foresee global growth falling below 2 percent, a pace consistent with outright contractions in many countries.

That hypothetical future no longer ​feels far-fetched. The key Brent crude oil price has traded persistently above $110 per barrel over the past week, even briefly surpassing $120 on Thursday.

On Thursday, official data showed a rebound in US GDP in the first quarter: output expanded at an annual 2 percent. ​This is far above growth rates in the euro zone and the United Kingdom. American unemployment, at 4.3 percent, remains low.

Consider the 1990 Gulf War, though. ​The US economy enjoyed solid growth and near-full employment at the time. But labour demand was softening and households were starting to get worried amid the savings and loan crisis. When oil prices surged 150 percent, consumer confidence collapsed and real-terms spending stalled. The Federal Reserve, constrained by rising inflation, was slow to ease policy.

Many ​of those conditions are echoed today, including a divided Fed likely to resist pressure from its new chair to cut rates. Surveys already show depressed ​consumer sentiment and higher inflation expectations.

Comparing oil shocks across decades is complicated by the fact that richer households now spend a smaller share of income on energy. In ‌recent years, energy goods and services have accounted for less than 4 percent of US disposable income, compared with about 5 percent before the Gulf War and 6 percent ahead of the 1970s crises.

One way to bridge that gap is to examine how much households are forced to raise that share when energy prices jump. One rule of thumb is that a 1 percent increase in American WTI oil prices typically lifts energy spending by roughly 0.22 percent. After July ​1990, the energy share of household ​incomes rose by about 0.3 percentage points, enough to tip the economy into recession, since higher energy bills forced consumers to cut spending elsewhere.

A shock of a similar size would emerge today if crude prices stayed where they are. And if oil ​hits $150 per barrel, the increase in the energy share would be 0.7 percentage points of disposable income. ​With oil at $200 per barrel, it would rise by a full percentage point. That would still be milder than the 1970s, but enough to hurt badly. Though far from certain, every new day makes a US recession look less outlandish.

US President Donald Trump will receive a briefing on April 30 regarding plans ​for new military operations in Iran, according to a report by Axios. It triggered ​renewed fears among traders of a monthslong standoff in the Middle East, sending oil prices up.

As of 1145 GMT on April 30, Brent crude and US WTI futures were trading ​at $114 per barrel and $104 per barrel respectively.

President Donald Trump said Friday that he will hike US tariffs on cars and trucks from the European Union next week, charging that the bloc is not complying with an earlier trade deal.

The pact, which was struck last summer, had capped the US tariff on EU autos and parts at 15 percent, which is lower than the 25-percent duty that Trump imposed on many other trading partners.

These sector-specific duties were not affected by a Supreme Court ruling earlier in the year that struck down a swath of Trump's global levies.

But the US leader said Friday: "Based on the fact the European Union is not complying with our fully agreed to Trade Deal, next week I will be increasing Tariffs charged to the European Union for Cars and Trucks coming into the United States."

"The Tariff will be increased to 25%," he wrote on his Truth Social platform.

He told a Florida event later Friday that Washington had informed Germany of his threat because "they and other European nations have not adhered to our trade deal."

He accused German automakers like Mercedes-Benz and BMW of ripping off Americans.

Trump's announcement came a day after his renewed criticism of German Chancellor Friedrich Merz. Trump told Merz to focus on ending the Ukraine war instead of "interfering" on Iran.

Germany would likely be hit hard by a sharp vehicle tariff, as it is responsible for a significant amount of EU auto exports.

Reacting to the announcement, a European Commission spokesperson told AFP: "Should the US take measures inconsistent with the joint statement, we will keep our options open to protect EU interests."

The spokesperson added that the bloc is implementing its commitments "in line with standard legislative practice" and keeping the Trump administration updated during this process.

Last July, the EU had laid the groundwork for possible retaliation if talks with Washington fell through -- preparing a list of US goods that could be targeted.

- 'Light a fire' -

"President Trump has clearly lost patience with EU efforts to implement its commitments under the bilateral trade deal concluded months ago," former US trade official Wendy Cutler told AFP.

She said Trump appeared to be "hoping to light a fire under Brussels to accelerate its domestic procedures."

His threats to the EU are reminiscent of a similar move against South Korea months ago, added Cutler, who is now senior vice president at the Asia Society Policy Institute.

In late March, EU lawmakers gave their green light to the bloc's tariff deal with Trump, but with conditions.

A large majority of EU lawmakers agreed to cut EU tariffs on some US imports, as a first step towards implementing the 2025 deal, but they also sought additional safeguards.

Although the European Parliament has given its conditional approval to the EU-US trade pact, before the deal is implemented by the bloc, it still needs to be negotiated with EU states.

The new threat on European cars "explain why many small businesses expect to be cautious" with Trump's tariffs, said Dan Anthony, who heads "We Pay the Tariffs," a coalition of nearly 1,200 small businesses.

"You never know what might trigger the next tariff threat," Anthony added in a statement.

In April, EU trade chief Maros Sefcovic was in Washington to meet with counterparts including US Commerce Secretary Howard Lutnick and trade envoy Jamieson Greer.

At the time, he said the EU was also seeking more progress in easing the effects of still-steep US steel tariffs, adding that talks were going in a positive direction.

The United States is the second largest market for new EU vehicle exports, after the United Kingdom, according to a 2025 fact sheet by the European Automobile Manufacturers' Association.

Over a fifth of EU vehicle exports went to the United States.

Germany alone exported some 450,000 vehicles to the United States in 2024, according to the VDA industry group. But that figure has since slipped.

Many of the worst-performing companies have outpaced market leaders in price gains in the secondary market over the past four months, as investors focus on short-term returns amid limited investment options.
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Apart from retailers, many institutional investors have not fixed any long-term investment strategy amid the liquidity crisis.

Ahead of the national election held on February 12, investors had been uncertain about the future market direction. After the election, investors' expectations regarding market stability faded as the US and Israel jointly struck Iran and waged war at the end of February.

As a result, the market outlook has become elusive, and investors remain fixated on speculative stocks in the hope of short-term gains.

This is the backdrop in which Dominage Steel Building Systems, despite a significantly negative P/E (price-to-earnings) ratio and one of its factories being shut, has continued its rally on the stock exchanges.

Dominage Steel registered a 131 per cent market price appreciation as of Thursday since January 1, while well-performing multinational company Linde BD experienced a 14.5 per cent decline during the period.

The board of Dominage Steel Building Systems last week disseminated price-sensitive information regarding the sale of their ownership stakes to Akij Resources and two individuals.

Some market operators said insiders, who were aware of the company's intention to sell ownership to the Akij conglomerate, might have played a role in the company's rally.

The rally of Dominage Steel does not reflect any fundamental strength.

Of the other non-performing companies that outperformed market leaders on the bourses, BBS Cables experienced a 30.3 per cent appreciation over the last four months.

The company distributed no dividends and reported a loss of Tk 856 million in FY25, increased from a loss of Tk 133 million in FY24. It has remained in the red in the last three quarters too.

The unjustified rally of BBS Cables, along with other non-performing companies, indicates that investors are hooked on short-term gains from speculative stocks.

Md. Ashequr Rahman, managing director of Midway Securities, said some groups had influenced the rallies of speculative stocks for short-term gains.

The financial performance of some of the companies that have seen a rally is better than that of other poor performers, but that is insignificant compared to blue-chip stocks that experienced correction.

"The absence of any new IPO is another reason why the secondary market has lost its buoyancy," Mr Rahman added.

The country's capital market has seen no new listings since March 2024.

The latest conflict between Iran and the US-Israel alliance disrupted fuel supply through the blockade of the Strait of Hormuz.

Local manufacturers said their profitability would be seriously affected due to the abrupt rise in production costs induced by fuel price hikes.

Apprehension over profit decline has been reflected in stock movements.

For example, the stock price of Unilever Consumer Care closed at Tk 2,163.6 each on April 6, which fell further to Tk 2,065.80 by Thursday.

Meanwhile, the stock price of ACI fell to Tk 193.80 each share on Thursday, which was Tk 211.6 on April 15.

Bangladesh's readymade garment sector in Chattogram is facing mounting pressure as prolonged load shedding and rising fuel costs disrupt production, with factory owners claiming a sharp increase in expenses and growing risks to export orders.

Although the Bangladesh Power Development Board claims that the Chattogram region is currently facing a daily load shedding of around 100MW, in reality, the situation is more difficult, according to garment owners.

At Meher Garments on Sagarika Road in the port city, where around 3,000 workers are employed, a typical workday has become a stop-start struggle, according to the authorities.

On 29 April, production at the factory started at 8am but stopped within 10 minutes due to a power outage. It took another 10 minutes to restart using generators. Power came back at 9:40am, but went out again at 11am. Electricity was restored an hour later.

After the lunch break, power went out again at 4:35pm and did not return until 5:25pm. In an eight-hour shift, the factory remained without electricity for roughly three and a half hours, while repeated switching between grid power and generators caused an additional 30 minutes of disruption.

"During summer, we used to face around two hours of load shedding daily, which required about Tk19,000 worth of diesel to keep the factory running," said Khondaker Belayet Hossain, director of the factory and a leader of the Bangladesh Garment Manufacturers and Exporters Association.

"Now, with three to four hours of outages and a 15% rise in diesel prices, our daily fuel cost has climbed to around Tk40,000," he said.

He added that prolonged generator use causes voltage fluctuations, damaging costly machinery and shortening equipment lifespan. "All of this is pushing up production costs, which were not factored in when orders were placed three months ago."

Industry insiders say the situation is not unique to a single factory. Most RMG factories in Chattogram are experiencing three to four hours of load shedding within an eight-hour workday, compounded by fuel shortages and higher operational costs.

As a result, production expenses have surged by about 20%, timely exports are being disrupted, and manufacturers fear losing orders to competing countries.

According to the industry data, 348 out of 699 RMG factories in Chattogram are currently operational. Unreliable electricity and fuel supply have reduced output, placing additional strain on the export-oriented industry.

BGMEA leaders say frequent power disruptions and gas shortages are disrupting production deadlines. This has delayed shipments, forcing some exporters to rely on air freight – significantly increasing costs.

Failure to meet delivery schedules risks eroding buyer confidence, which could affect future orders, they warned.

Former BGMEA vice-president Rakibul Alam Chowdhury said factories are increasingly dependent on alternative fuel sources due to load shedding, driving up production costs.

"Over the past two months, rising freight charges, higher container handling costs at inland container depots, and increased transport fares have pushed overall production costs up by more than 20%," he said.

"As manufacturers seek higher prices from buyers, many foreign clients are cutting back on new orders or shifting to competitor countries," he said.

SM Abu Tayyab, BGMEA director and president of the Chattogram chapter of the International Business Forum of Bangladesh, warned that the prolonged crisis could severely impact the export earnings.

"If the situation continues, small and medium-sized factories may be forced to shut down, leaving hundreds of thousands of workers unemployed," he said.

He stressed the need for urgent steps to resolve load shedding and gas shortages and to ensure energy security, cautioning that failure to act could put Bangladesh's key export sector at serious risk.

When contacted, Fahmida Begum, the executive engineer of the Power Development Board in Chattogram, said, "After the rain, the electricity demand has decreased leaving no requirement for load shedding. But, still there may be power outages due to a fault in the transmission line during thunderstorms and heavy rain."

Bangladesh's economy risks falling into an "energy trap" due to rising global fuel prices, dollar shortages and pressure from import dependence, speakers warned.

The concerns were raised today (2 May) at a webinar titled "Today's Agenda: Economy Trapped in the Energy Crisis?" organised by Power and Participation Research Center (PPRC).

Speakers said the crisis had intensified because of supply constraints, demand-driven reactions and communication gaps. Some early disruptions quickly turned into panic buying, causing a sudden spike in fuel demand. Although rationing and other measures were introduced, uncertainty made the situation more complex. Participants also discussed energy security during future emergencies.

Former energy secretary AKM Zafar Ullah Khan said long-standing planning weaknesses in the energy sector were now becoming clear. Aligning with global markets had further exposed domestic vulnerabilities.

He said questions were being raised about how much fuel Bangladesh could store and for how long. Fuel prices would eventually have to be adjusted in line with international markets, but uninterrupted supply remained the key priority. He added that the country did not have enough storage capacity to handle large fluctuations in incoming or outgoing oil supplies.

Former Bangladesh Agricultural University vice-chancellor A Sattar Mondal said, "Agriculture was becoming increasingly machine-dependent, raising fuel demand. Ensuring steady fuel supply has become essential for maintaining production at the field level."

He said muscle power in farming had largely been replaced by machine power. "Around 4.2 million diesel engines are used across the agricultural sector, not only for irrigation but also in many other activities," he said.

Sattar expected both machinery use and diesel demand to rise further.

Syed Mahmudul Haque, chairman of Trade Services International, said fluctuations in global fuel prices were directly increasing Bangladesh's import costs, putting pressure on foreign currency reserves and the wider economy.

He said every $5 rise per barrel in the international market significantly increased Bangladesh's import bill. He urged the country to consider alternatives, including diversifying sources of supply instead of relying mainly on the Middle East.

Anwar-ul Alam Parvez, chairman of the Bangladesh Chamber of Industries, said changing geopolitical conditions were making fuel supplies more uncertain, requiring coordinated and diversified planning.

"Bangladesh needed short-, medium- and long-term policies to secure the energy sector. Immediate steps should include operating coal-based plants according to capacity, maintaining domestic capability with imports from Adani Group and India, and prioritising gas supplies for fertiliser and productive industries," he said.

Mohammad Nazmul Haque, president of the Bangladesh Petrol Pump Owners Association, stressed the need to expand renewable energy and accelerate domestic gas exploration to reduce import dependence.

"Renewable resources must now be utilised, while more emphasis should be placed on drilling gas wells," he said, adding, "140 wells had been initiated since the current government took office."

Speakers also said that although supply conditions had not improved significantly, stronger demand management and monitoring had helped stabilise the situation gradually. However, uneven distribution at fuel stations and excessive media focus on local shortages had increased public anxiety.

Concluding the discussion, Hossain Zillur Rahman said the fuel crisis had exposed gaps in both immediate response and medium-term planning. Without coordinated policy and effective implementation, such crises could deepen and recur.

He also said accurate information flow during crises was essential, warning that false or exaggerated messaging could further destabilise the situation.

Although the introduction of family and farmers’ cards may bring some relief, excessive reliance on bank borrowing to finance the budget deficit is harmful to the economy, said Fahmida Khatun, executive director of the Centre for Policy Dialogue (CPD).

She made the remarks yesterday at a shadow parliament debate programme organised by Debate for Democracy at the Bangladesh Film Development Corporation (FDC) in Dhaka.

Fahmida said government social safety net initiatives, such as the family and farmers’ card, are promising, but their success depends on transparency and accountability in selecting and managing beneficiaries.

She added that past social protection schemes have often suffered from irregularities and corruption.

Fahmida also said subsidies must be properly targeted, with priority given to agriculture, irrigation, and public transport.

She stressed that the next budget should set clear policy directions-- given limited resource mobilisation, and ensure cost-efficiency.

Fahmida further said that the government depends heavily on borrowing from the banking sector, including the central bank, to cover budget deficits, which she described as harmful.

She argued that greater emphasis should instead be placed on external financing sources.

She also suggested temporarily waiving VAT on imported goods amid global volatility to reduce pressure on consumers. Such a step during Ramadan in the past helped lower prices in local markets, she said, although weak market management could limit its full impact.

Hassan Ahamed Chowdhury Kiron, chairman of Debate for Democracy, said the country’s economy is going through a difficult period due to multiple global and domestic challenges.

He said the current government has taken office at a time when the country is suffering from years of crisis-- the Covid-19 pandemic, the Russia-Ukraine war, economic damage from previous administrations, conflicts in the Middle East, energy shortages, rising inflation, low investment, limited job opportunities, high levels of loan defaults, and pressure from foreign debt.

He added that the US-Israel war on Iran has further worsened the global economic situation.

Rising global commodity prices and higher fuel costs due to Middle East tensions have increased the cost of living in the country, Kiron said in a statement after the programme.

He stressed that in a global recessionary situation, political unity is needed to maintain a tolerable standard of living without putting extra pressure on the government.

He also said both the government and the opposition must act responsibly, learn from past experiences, and avoid undermining each other, while a strong mandate holder should ensure public support by maintaining people’s comfort.

Kiron suggested temporarily reducing VAT and taxes on essential goods and expanding the affordable food supply through open market sales and the Trading Corporation of Bangladesh.

He also called for stronger social safety nets and more programmes like the family and farmers’ card to protect low- and middle-income groups.

Finally, he said the budget should be people-friendly, business-friendly, cautious, sustainable, balanced, and implementable, without putting pressure on lower-middle-income groups, while also helping stabilise prices and support investment and job creation.

In the shadow parliament debate titled “Rising cost of living is driven not by fuel price hikes but by global conditions,” debaters from Kabi Nazrul Government College defeated Dhaka College to win the competition.

Bangladesh is facing a deep economic crisis and may need to endure "two difficult years" to recover, Finance Minister Amir Khosru Mahmud Chowdhury warns.
FE

As such, he says, the government is likely to take measures that may not be popular.

During discussion on the motion of thanks on the President's address in parliament on Thursday, the minister said, "We may have to endure hardship for two years. The next two years will be difficult. We will have to make many decisions and steps some of which may not be popular."

Presenting what he describes as a grim picture of the economy, the finance minister said the country's tax-to-GDP ratio has fallen below 7.0 per cent, the lowest in South Asia. The poverty rate stands at 29.93 per cent, prompting him to remark: "Look at the condition we are in now in terms of the economy."

He further mentions that capital-machinery imports, which were 53 per cent during the last tenure of the Bangladesh Nationalist Party, have dropped sharply to 14.5 per cent. Private -sector credit growth has also declined to 6.0 per cent compared to 18.2 per cent in 2005-06. Default loans in the banking sector have surged to 30 per cent. "When a country's banking sector has this scale of non-performing loans, the economy almost grinds to a halt," he tells the newly elected parliament after a political changeover. Politics

The custodian of exchequer further notes that the government currently provides annual subsidies amounting to Tk 360 billion, with an additional Tk 200-300 billion required this year.

External overdue payments stand at US$508 million for fuel imports and $737 million for gas.

The deposed administration has been accused of widespread "corruption, looting and money laundering" across the banking sector and other industries during its one-and-a-half-decade rule, he points out. A white paper was prepared under the interim government led by Muhammad Yunus to assess the state of the economy.

In addition, he informs the House, the Anti-Corruption Commission has filed cases against several industrial groups, Sheikh Hasina, and members of her family on allegations that include money laundering. Measures such as asset seizures and freezing of bank accounts have also been taken.

Despite these efforts, the economy has yet to recover during the post-uprising interim period.

The situation worsened further after the outbreak of the Iran War on February 28, which put additional pressure on sectors such as energy under the new BNP-led government.

Addressing the parliament, the finance minister says the economy has been pushed to such a low level that only tough reforms, deregulation, and structural changes could restore stability. Newspapers

He stresses that lifting the economy from its current situation would require decisive and, at times, unpopular policy measures over the coming years.

Bangladesh is set to issue its eighth government investment Sukuk worth Tk 59 billion (Tk 5,900 crore) to finance the construction and development of important bridges on rural roads under a revised project, according to an official statement.
FE

The seven-year “CIBRR-1 Socio-Economic Development Sukuk” will be issued under the project titled Construction of Important Bridges on Rural Roads (1st Revised). The prospectus and Shariah declaration of the Sukuk have already been finalised with approval from the Shariah Advisory Committee under the Debt Management Department.

The auction for the Sukuk will be held for the first time on May 13, 2026, using Bangladesh Bank’s in-house Shariah Securities Module (SSM) system.

According to the prospectus, Sukuk will be issued through an auction-based lease structure with a face value of Tk 59 billion (Tk 5,900 crore), maturing on May 14, 2033.

Investors will receive a total rental return of Tk 42.95 billion (Tk 4,295.20 crore) over seven years, equivalent to an annual return of 10.40 percent, payable on a semi-annual basis.

Banks and financial institutions having current or Al-Wadiah accounts with Bangladesh Bank will be eligible to participate directly in the auction. In addition, domestic and foreign individual investors, corporate bodies, investment companies, insurance companies, provident funds and deposit insurance funds may also participate through eligible banks and financial institutions maintaining accounts with Bangladesh Bank.

Investors will be able to submit bids online through the SSM system using their Sukuk Investor (SI) ID in multiples of Tk 10,000 between 10:00am and 3:00pm on May 13, 2026.

New investors must complete their SI ID registration through their respective banks by May 12, 2026.

The successful bidders will be informed of their allotted Sukuk amount through their respective accounts at 4:00pm on the auction day, the statement said.

Bangladesh government has sought extended financial and technical supports from foreign development partners to weather the economic shocks stemming from the Gulf crisis and to accelerate implementation of its election pledges, officials say.
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Formal requests for the support were despatched to a broad coalition of multilateral and bilateral lenders recently, officials from the Economic Relations Division (ERD) told the FE Saturday. The list of financiers includes the World Bank, the Asian Development Bank (ADB), Japan, the Asian Infrastructure Investment Bank (AIIB), German lender KfW, and the OPEC Fund for International Development (OFID).

The Finance Adviser to the Prime Minister, Dr Rashed Al Mahmud Titumir, sat with Bangladesh's development partners in Dhaka in the just-past last month to convince the development partners about the urgency. GeographicReference

At the meeting, some of the DPs assured of supporting the government in implementing its poll manifesto and overcome the exigencies, the ERD officials say.

The move comes as the government seeks to "weather the impact" of volatility in the Gulf region, which has significant implications for Bangladesh's energy costs and remittance inflows.

Beyond crisis management, the funding is intended to provide the fiscal space necessary to execute the socioeconomic promises laid out in the government's recent election manifesto.

"After the meeting, we have formally written to the DPs to help Bangladesh," says one official.

According to the ERD officials, the ADB and the WB have already assured of extending their budget support to Bangladesh amid the current gulf crisis.

Although the ADB earlier had assured of some US$750 million worth of budgetary support for Bangladesh within this fiscal year (FY), 2025-26, it now assured of enhancing the proposed financing to $1.0 billion following Bangladesh's request, says a senior ERD official.

The World Bank is expected to provide at least $500 million worth of budget support to help weather the Gulf crisis as well as meet the immediate needs of the newly elected government, especially for the social-safety-net programmes and reforms, he adds.

"In addition to our traditional bilateral and multilateral donors, we have already requested some non-traditional ones, including KFW, OFID, AIIB and Middle-eastern countries, to offer financial and technical supports to Bangladesh," the ERD official says.Financial

In a proactive bid to secure these commitments, Dr Rashed Al Mahmud Titumir held a high-level meeting with representatives of the development partners in Dhaka last month.

Sources privy to the discussions note that the Finance Adviser underscored the urgency of the situation, emphasizing the need for both concessional loans and technical cooperation to maintain the country's growth trajectory.

The ERD officials indicate that the requested support would be channeled into several key areas, including macroeconomic stabilization, offsetting the rising costs of fuel and commodities linked to the Gulf turmoil, advancing megaprojects and regional-connectivity initiatives in line with national development goals.

The government has also sought support in the social-safety-net programmes for ensuring the election manifesto's focus on poverty reduction and social protection, say the officials.

While the development partners have historically been supportive of Bangladesh's developmental journey, the scale of this coordinated request highlights the complexity of the current global economic climate, they add.

"The government is looking for a comprehensive partnership to not only overcome immediate hurdles but to build a more resilient Bangladesh," another ERD official says, indicating newer

"The discussions led by Dr Titumir were a crucial step in aligning our development partners with our national priorities."

The ERD is expected to engage in follow-up technical negotiations with individual lenders in the coming weeks to finalize the volumes and terms of the prospective aid packages, he adds.

The government has selected two Chinese companies to drill three wells at different locations across the country at a cost of Tk 945 crore.

The Cabinet Committee on Government Purchase approved the firms for key energy exploration projects at its 19th meeting, held yesterday and chaired by Finance Minister Amir Khosru Mahmud Chowdhury. The projects aim to strengthen the country’s gas and oil reserves.

Under a BAPEX project, two exploratory wells -- Srikail Deep-1 and Mobarakpur Deep-1 -- will be drilled as part of a three-well programme. The contract for these two wells was awarded to CNPC Chuanqing Drilling Engineering Company Limited at a cost of Tk 713 crore.

The committee also approved the drilling of the Sylhet-12 oil well under a separate project. The contract was awarded to Sinopec International Petroleum Service Corporation (SIPSC) at a cost of Tk 232 crore, covering drilling and related works.

Foreign financing received by Bangladesh fell 19 percent year-on-year in the July-March period of fiscal year 2025-26 (FY26), mainly due to the slow implementation of foreign-funded development projects.

The government received $3.89 billion in foreign loans during the nine months of FY26, down from $4.80 billion in the same period of the previous fiscal year, according to provisional data from the External Resources Division (ERD) published yesterday.

Data from the Implementation Monitoring and Evaluation Division under the Ministry of Planning showed that implementation of the foreign-funded Annual Development Programme (ADP) stood at 34.56 percent in July-March this year, slightly lower than 35.8 percent in the same period last year.

Of the loans received by Bangladesh, Russia disbursed $828 million, according to ERD data.

However, debt servicing rose to $3.52 billion during July-March, up 9 percent from $3.21 billion a year earlier. Interest payments accounted for $1.24 billion of the total repayment.

ERD data also showed that commitments from both multilateral and bilateral lenders declined during the period.

Total commitments in July-March FY26 stood at $2.80 billion, down 6.6 percent year-on-year. All commitments during this period were in the form of project assistance.

Gold rose on Thursday on ‌dip-buying, but was on track for a second straight monthly fall as elevated oil prices kept fears of inflation and higher-for-longer interest rates alive.

Spot gold was up 1 percent at $4,588.09 per ounce, as of ​0736 GMT, after falling to its lowest point since March 31 in ​the last session. Bullion was down about 1.7 percent so far this month.

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US gold futures for June delivery rose 0.4 percent to $4,578.10.

“Gold has struggled again this month ​as oil strength has dominated the narrative. Rising crude pushes up inflation expectations and interest ​rate forecasts, which in turn caps gold’s appeal,” said Tim Waterer, chief market analyst at KCM Trade.

However, “a combination of bargain-hunting and expectations that a peaceful resolution to the (US-Iran) conflict will be found at ​some point are providing something of a floor for gold,” he said.

Brent crude ​rose above $124 a barrel on a report that the US was considering potential military action against Iran to ‌break ⁠the deadlock in negotiations to end the war, increasing concerns about more supply disruptions to already curtailed Middle East exports.

The Federal Reserve held interest rates steady on Wednesday, but in its most divided decision since 1992 noted rising concerns about inflation in a policy ​statement that drew ​three dissents from officials ⁠who no longer feel the US central bank should communicate a bias towards lowering borrowing costs.

Traders are now pricing in no ​Fed rate cuts this year, with markets seeing a 30 percent chance ​of a ⁠hike by March 2027, sharply up from roughly 5 percent a day prior.

While gold is traditionally seen as a hedge against inflation, high interest rates weigh on its appeal as ⁠a non-yielding ​asset.

The government has formed a high-powered panel to review the widely discussed ordinances on revenue reform framed by the Prof Muhammad Yunus-led interim administration.

The ordinance and its subsequent amendment on Revenue Policy and Revenue Management, along with 12 other ordinances, lost validity as the parliament failed to ratify them within the constitutionally mandated 30-day period since its first sitting on March 12.

According to a Cabinet Division notification issued on April 28, the nine-member panel will be headed by Ismail Zabiullah, the prime minister’s adviser on public administration, to re-examine the Revenue Policy and Revenue Management Ordinance and its amendment.

Framed in May 2025, the ordinances sought to separate tax policy formulation from collection and to form two divisions by dissolving the NBR, which drew massive protests from revenue officials in June
The committee includes Rashed Al Mahmud Titumir, adviser to the prime minister on finance and planning, along with the cabinet secretary and secretaries of the finance, public administration, and legislative divisions.

The National Board of Revenue (NBR) chairman will serve as the member-secretary of the panel to review the ordinance and make recommendations to propose a new bill for revenue reform, a key condition tied to the International Monetary Fund’s (IMF) $5.5 billion loan programme approved for Bangladesh.

Multilateral lenders, including the IMF, had long advocated reforms in the tax system and administration to boost revenue collection, as Bangladesh has one of the world’s lowest tax-to-GDP ratios.

Framed in May 2025, the ordinances sought to separate tax policy formulation from collection and to form two divisions by dissolving the NBR, which drew massive protests from revenue officials in June.

The process of separation was further delayed in the later months due to bureaucratic wrangling over the organogram and rules of business.

Subsequently, the interim administration left office, leaving the implementation of the law to the next elected government.

At a meeting with the Economic Reporters’ Forum on April 25, Finance Minister Amir Khosru Mahmud Chowdhury termed the country’s tax framework historically “half-baked” and said a new committee has been formed to separate tax policy from execution, ensuring future policies “genuinely reflect the will of the people.”

US ​exports of liquefied natural gas to Asia jumped in April, with American producers helping offset reduced supplies ‌from Middle Eastern exporters as the Iran war curtailed output in the region, preliminary ship-tracking data from financial firm LSEG showed.

Nearly a quarter of all US LNG exports went to Asia during the month, marking a sharp increase since the conflict ​began in late February and underscoring the growing role of the US as a swing supplier amid elevated prices and strained ​global gas flows.

Shipments to Asia have risen more than 175 percent since the US and ⁠Israel launched strikes on Iran, climbing from about 970,000 metric tons in February to 1.99 million metric tons (MT) in ​March and 2.71 MT in April, the data show.

Asian spot LNG prices remained elevated. The Japan Korea ​Marker benchmark averaged $17.92 per million British thermal units (mmBtu) in April, down slightly from $18.27 in March but still about 17 percent above Europe’s TTF benchmark, which averaged $15.34 per mmBtu in April, down from $17.99 in March.

The increase in US shipments to Asia came ​even as overall LNG exports slipped from a record high in March, falling to 10.97 MT in April ​from 11.7 MT in March, LSEG data showed.

The decline was largely due to April having one fewer day than March ‌and ⁠delays in cargo loadings. Gas flows to US LNG export plants reached a record 18.8 billion cubic feet per day during April, up from the previous peak of 18.7 bcfd in February, according to LSEG.

The US shipped its first LNG from the Golden Pass terminal in April with a single cargo sent to Belgium. ​Golden Pass - a joint ​venture between QatarEnergy (QATPE.UL) and ⁠Exxon Mobil XOM.N - drew just under 300 million cubic feet per day of gas during the month but exported one cargo, which may have contributed to the ​gap between record feedgas demand and lower LNG exports.

Europe remained the top destination for ​US LNG, ⁠receiving 6.14 MT, or just under 56 percent of April exports, according to the data. Egypt was also an active buyer, importing about 710,000 metric tons of US LNG during the month, more than the total 500,000 metric tons ⁠shipped ​to Latin America.

One cargo was delivered to South Africa, a ​rare destination for US LNG. Nine LNG vessels that departed US ports in April were still seeking buyers, including two anchored near ​the Suez Canal, ship-tracking data showed.

An Iranian proposal on negotiations with the U.S. sent crude oil futures diving on Friday, ‌but prices remained on track for weekly gains, with Tehran still blocking the Strait of Hormuz and the U.S. Navy blocking exports of Iranian crude.

Brent crude futures for July settled at $108.17, down $2.23 a barrel, or 2.02%. West Texas Intermediate futures finished at $101.94 a barrel, down $3.13, or 2.98%.

Iran sent its latest proposal for negotiations with the United States to Pakistani mediators on Thursday, state news agency IRNA reported on Friday, a ⁠move that could improve prospects for breaking an impasse in efforts to end the Iran war.

Still, the Brent benchmark and WTI were poised for a 2.95% gain over the week. Brent's June contract hit $126.41 a barrel on Thursday, marking the highest level since March 2022, before ending the session down.

"This Iran proposal has given hope to the market that there is an off-ramp for the United States," said Phil Flynn, senior analyst with Price Futures Group.

Oil prices have been on the rise since the U.S. and Israel attacked Iran at the end of February, resulting in the closure of the Strait of Hormuz and the disruption of shipments of about a fifth of ‌the world’s ⁠oil and liquefied natural gas supply.

A ceasefire has been in place since April 8. UAE presidential adviser Anwar Gargash said on Friday Tehran could not be trusted over any unilateral arrangements it makes for the Strait of Hormuz, in a sign of deep mistrust on all sides.

By the end of trading on Friday, the oil market appeared to be accepting the uneasy truce in ⁠the conflict.

"The market rises and falls on the prospects of an outcome to the conflict," said John Kilduff, partner with Again Capital. "And right now the situation is a stalemate, at least until the market closes."

A senior official of Iran's Revolutionary Guards had ⁠threatened on Thursday "long and painful strikes" on U.S. positions if Washington renewed attacks on Iran, pushing oil prices to intraday peaks before retreating.

U.S. President Donald Trump was scheduled to receive a briefing on Thursday on plans for a ⁠series of fresh military strikes on Iran to compel it to negotiate an end to the conflict, a U.S. official told Reuters.

Washington did not immediately announce any details of its plans.

CAPM BDBL Mutual Fund 01, a closed-end mutual fund, has returned to profitability in the first nine months of the 2025-26 fiscal year, recovering from a big loss during the same period last year.

According to the unaudited financial statements presented at a trustee meeting yesterday, the organisation posted a net profit of Tk3.43 crore for the July-March period, though it had incurred a heavy loss in the corresponding period of the previous fiscal year.

The fund's earnings per unit (EPU) stood at Tk0.69 for the first nine months of FY26, a sharp recovery compared to a loss per unit of Tk0.83 a year ago.

The performance in the third quarter (January-March) also showed a positive trend as it reported a net profit of Tk1.47 crore, yielding an EPU of Tk0.29. This marks an improvement from the January-March quarter of the previous year, when the fund suffered a net loss of Tk3.17 crore and a loss per unit of Tk0.63.

As of March 31 this year, the total Net Asset Value (NAV) of the fund stood at Tk55.62 crore on a cost-price basis and Tk41.85 crore on a market-price basis.

The NAV per unit at cost price was recorded at Tk11.10, while its per unit at market price stood at Tk8.35, against a face value of Tk10 per unit.

The fund is managed by CAPM Company Limited, while the Investment Corporation of Bangladesh acts as its trustee and custodian.

Oil prices held around four-year highs Thursday while stocks fell after Donald Trump warned the US blockade of Iranian ports could last months as peace talks remained stalled.

While Tehran submitted a fresh proposal this week to reopen the crucial Strait of Hormuz, the US president reportedly did not believe it was not negotiating in good faith.

The Wall Street Journal said he had told national security officials to prepare for a long blockade to compel the Islamic republic to give up its nuclear programme.

At a meeting of oil executives Tuesday, he discussed efforts "to alleviate global oil markets and steps we could take to continue the current blockade for months if needed and minimise impact on American consumers", a White House official said on condition of anonymity.

Meanwhile, Trump told Axios: "The blockade is somewhat more effective than the bombing. They are choking like a stuffed pig. And it is going to be worse for them. They can't have a nuclear weapon."

He added that the naval action would not end until he had secured a deal with Tehran to address its nuclear programme.

In a post on his Truth Social platform, Trump said: "Iran can't get their act together. They don't know how to sign a nonnuclear deal. They better get smart soon!"

He posted an illustration of himself holding an assault rifle alongside the caption "NO MORE MR. NICE GUY!"

The prospect of the strait -- through which a fifth of world oil and gas passes -- being closed for months more sent crude surging to the highest level since 2022 after Russia invaded Ukraine.

Brent for June delivery, which hit a peak of $122.53 Wednesday, was sitting around $120 in Asian trade, while West Texas Intermediate was around $108.

Analysts said traders were beginning to shift to the view that the crisis will not be as short as initially hoped.

Tech's AI rally

Stock markets also struggled, with Tokyo, Hong Kong, Shanghai, Sydney, Seoul, Manila and Jakarta all down. There were gains in Singapore, Wellington and Taipei.

The dollar, seen as a safe haven during the crisis, rose against its peers.

However, equity traders remain relatively upbeat thanks to a revival of the AI trade, which has helped push Seoul's Kospi index to multiple record highs.

The country's Samsung Electronics reported a 750 percent surge in operating profit to a record high on Thursday, thanks to strong sales of chips crucial for artificial intelligence, while it also forecast healthy demand in the next three months.

That came after Microsoft, Meta and Google-parent Alphabet posted forecast-busting earnings.

US stock futures rose.

SPI Asset Management's Stephen Innes warned that the positive mood on stock markets could change.

"History tells us that this widening divide between stocks, oil, and rates can only stretch so far before the physical shock bleeds into the real economy," he wrote.

"Expensive energy is not abstract. It moves quietly through the system, from the pump to logistics to margins, eventually surfacing in the data that central banks respond to after the fact."

Investors were also assessing the outlook for the Federal Reserve's policy actions after four members of its decision-making body dissented on a vote, the most since 1992.

While it voted to hold interest rates owing to fears of a spike in inflation caused by surging energy costs, three "did not support inclusion of an easing bias in the statement at this time."

A fourth voting member, Trump-appointee Stephen Miran, had sought a quarter-point cut.

The meeting was the last with Jerome Powell as Fed boss, with Kevin Warsh -- the president's pick -- to take over next month.

Trump spent much of his second term blasting Powell for not cutting borrowing costs quickly enough.

Key figures at 0300 GMT

West Texas Intermediate: UP 1.9 percent at $108.92 a barrel

Brent North Sea Crude: UP 2.9 percent at $121.48 a barrel

Tokyo - Nikkei 225: DOWN 1.0 percent at 59,304.62 (break)

Hong Kong - Hang Seng Index: DOWN 1.3 percent at 25,763.07

Shanghai - Composite: DOWN 0.1 percent at 4,104.67

Euro/dollar: DOWN at $1.1668 from $1.1695 on Wednesday

Pound/dollar: DOWN at $1.3476 from $1.3489

Dollar/yen: UP at 160.34 yen from 160.23 yen

Euro/pound: DOWN at 86.58 pence from 86.71 pence

New York - Dow: DOWN 0.6 percent at 48,861.81 (close)

London - FTSE 100: DOWN 1.2 percent at 10,213.11 (close)

Bangladesh's banking sector is facing mounting pressure in the capital market as at least 10 more listed banks are set to be downgraded to the Dhaka Stock Exchange's (DSE) 'Z' category, commonly known as junk stocks, after failing to declare dividends for two consecutive years.

Sources at the DSE said the affected banks include AB Bank, Al-Arafah Islami Bank, IFIC Bank, Mercantile Bank, NRB Bank, NRBC Bank, ONE Bank, Premier Bank, Rupali Bank and United Commercial Bank. If implemented, this will mark the first time these lenders fall into the lowest trading category.

A senior official of the Dhaka Stock Exchange (DSE) said the banks will be downgraded to the 'Z' category from today, the first trading session of the week.

The development follows a similar move earlier this week, when Islami Bank Bangladesh, Standard Islami Bank and SBAC Bank were downgraded after failing to reward shareholders for two consecutive years.

Market sources said the primary reason behind the sector-wide dividend drought is a large provision shortfall against classified loans and investments. Under Bangladesh Bank regulations, lenders with provision deficits are barred from declaring dividends.

To remain compliant with regulatory requirements, several banks have reportedly taken deferral facilities from the central bank, effectively postponing financial obligations while remaining unable to distribute profits.

Financial data for 2025 reflects significant stress in the sector. AB Bank reported a consolidated loss of Tk 3,889 crore alongside a provision shortfall of Tk 16,874 crore.

IFIC Bank posted a loss of Tk 2,560 crore with a shortfall of Tk 18,557 crore.

Even banks that managed marginal profits remain under pressure. United Commercial Bank reported a profit of Tk 23.25 crore, while ONE Bank posted Tk 29.84 crore, both facing provision gaps exceeding Tk 5,000 crore and Tk 1,700 crore, respectively.

Al-Arafah Islami Bank reported a consolidated profit of Tk 85 crore against a provision shortfall of Tk 4,998 crore. Mercantile Bank posted a profit of Tk 121 crore with a shortfall of Tk 2,161 crore.

NRB Bank earned Tk 13.81 crore profit with a Tk 180 crore shortfall, while NRBC Bank reported Tk 13.25 crore profit against a Tk 1,006 crore gap.

Premier Bank incurred a loss of Tk 993 crore with a Tk 6,089 crore provision shortfall, while Standard Islami Bank reported a profit of Tk 80.34 crore against a Tk 5,904 crore shortfall.

Rupali Bank posted a profit of Tk 23.25 crore but faced a Tk 14,014 crore provision gap.

Islami Bank Bangladesh reported the highest provision shortfall at Tk 84,615 crore, despite posting a profit of Tk 136 crore in 2025.

Market experts said the expected downgrade signals deteriorating fundamentals in the banking sector, raising concerns over governance, asset quality and risk management.

Z-category stocks are widely considered high-risk due to persistent compliance failures and weak financial health. These shares are subject to stricter trading rules, including a T+3 settlement cycle instead of T+2, cash-only transactions and restrictions on margin loans, significantly reducing liquidity.

Currently, 36 banks are listed on the country's stock exchanges. With 10 more banks set to join the five already in the junk category, a total of 15 banks, around 42% of listed banking stocks will be in the 'Z' category.

This does not include five other banks, Social Islami Bank, Exim Bank, Global Islami Bank, First Security Islami Bank and Union Bank, whose shares remain suspended due to merger-related processes with Sommilito Islami Bank, though they are yet to be formally delisted.

Analysts attribute the growing crisis to a surge in non-performing loans, many of which were allegedly disbursed without adequate due diligence in previous years.

Following regulatory tightening in 2024, scrutiny has intensified, exposing deeper weaknesses in loan portfolios across several banks.

A senior market analyst said that while stricter regulatory measures are necessary to restore discipline in the sector, general shareholders are bearing the cost of governance failures and deteriorating asset quality, as dividend flows continue to shrink.

Bangladesh has stayed off the latest United States intellectual property (IP) rights watch lists, but Washington has still urged Dhaka to strengthen enforcement to prevent unfair trade practices.

In its annual Special 301 Report released on Thursday, the Office of the United States Trade Representative (USTR) identified 26 trading partners for intellectual property protection and enforcement concerns.

It grouped them into three categories -- Priority Foreign Country, Priority Watch List and Watch List.

In this year’s report, Vietnam has been designated a Priority Foreign Country, a rare and severe classification that can trigger a trade investigation. The USTR said Vietnam has failed to address long-standing concerns over intellectual property protection and enforcement.

The designation is reserved for countries with the most serious IP-related practices that have a significant impact on US industries and are not making meaningful progress in negotiations or reforms.

The report said Vietnam had shown a persistent failure to resolve long-standing concerns. The United States first raised the issue in 2020 through a proposed IP Work Plan, followed by a revised proposal in 2023.

The USTR report added that Vietnam has made little progress in later bilateral engagement, including talks linked to an Agreement on Reciprocal, Fair, and Balanced Trade. Vietnam’s actions or inactions are causing significant damage to industries reliant on intellectual property in the US and other markets.

This year, the USTR placed six countries on its Priority Watch List. Those are Chile, China, India, Indonesia, Russia and Venezuela.

It said it would seek to engage intensively with these partners over the coming year.

A further 19 trading partners have been placed on the Watch List. Those are Algeria, Argentina, Barbados, Belarus, Bolivia, Brazil, Canada, Colombia, Ecuador, Egypt, the European Union, Guatemala, Mexico, Pakistan, Paraguay, Peru, Thailand, Trinidad and Tobago and Türkiye.

Argentina and Mexico have been moved from the Priority Watch List to the Watch List, reflecting improvements in intellectual property policy. Bulgaria has been removed from the list, while the European Union has been added.

Regarding Bangladesh, the USTR pointed to commitments made under a recently signed Agreement on Reciprocal Trade. This includes broad commitments on market access, economic and national security, and trade standards, including intellectual property.

Apart from Bangladesh, the United States has so far completed such agreements with Argentina, Cambodia, Ecuador, El Salvador, Guatemala, Indonesia, Malaysia and Taiwan.

These agreements, the USTR said, contain commitments aimed at strengthening intellectual property protection and enforcement against piracy and counterfeiting.

Citing a study by the Organisation for Economic Co-operation and Development (OECD) and the European Union Intellectual Property Office (EUIPO), released in May 2025, the USTR report said global trade in counterfeit and pirated goods reached $467 billion in 2021, equal to 2.3 percent of global imports.

USTR said Bangladesh was among the top five source economies for counterfeit clothing globally.

In fiscal 2025, China and Hong Kong together accounted for more than 87 percent of the value of counterfeit and pirated goods seized by US Customs and Border Protection, measured by manufacturers’ suggested retail price.

The report also highlighted ongoing US concerns over the EU’s aggressive geographical indication policies.

It said that the EU’s rules on geographical indications unfairly block American exporters from selling goods under familiar names or trademarks. To counter this, the US is pressing its case in trade talks and global forums such as the Asia-Pacific Economic Cooperation, World Intellectual Property Organization and the World Trade Organization.

It is also negotiating directly with individual countries, including Bangladesh, Brazil, Canada, China, Mexico and others, to ensure American producers can keep access to foreign markets.

The USTR said the Agreement on Reciprocal Trade signatories included provisions aimed at protecting US market access for cheese and meat producers using common names. It said these agreements also include commitments on transparency and fairness in geographical indication protections.

Delays in trademark registration, the report added, remain a major obstacle to protecting intellectual property rights.

Stakeholders identified Bangladesh, Iraq and South Africa as countries with severe delays in processing applications.

Rice supply is expected to fall this year as farmers cut planting acreage across Asia because of fertiliser shortages and soaring fuel costs from the Iran war, with an emerging El Nino also set to squeeze output of the world's most consumed staple.

Rice is central to global food security, and even modest supply disruptions can ripple through countries, lifting prices and straining household budgets, particularly among price-sensitive consumers in Asia and Africa. The UN Food and Agriculture Organization in April forecast rice output would expand by 2% to a record high in 2025/26.

The effects of the Iran war are impacting farmers in top exporters Thailand and Vietnam as well as the import-reliant Philippines and Indonesia, growers and traders said. The war has cut fuel and fertiliser flows through the Strait of Hormuz, a key chokepoint that connects the Gulf to global markets.

Southeast Asia's mainly smallholder farmers also face mounting stress as the El Nino weather phenomenon is set to usher in hotter, drier conditions for the region in the second half of the year.

"Farmers have already started planting rice in some countries and are using fewer inputs because prices have gone up," said Maximo Torero, chief economist at the UN FAO. "We are going to see a tighter global supply situation in the second half of the year and early next year."

In 2008, export curbs by key suppliers more than doubled prices to about $1,000 a metric ton, triggering unrest in several countries. More recently, supply tightness in 2022 to 2023, exacerbated by India's export restrictions, lifted prices and prompted panic buying.

Supply-chain disruption

Rice shipments are already facing supply-chain bottlenecks.

"Logistics have become a nightmare, especially in Asia as there is shortage of polypropylene bags, limited truck availability to move rice to ports and shipping itself has been disrupted," said a Singapore-based trader at a top global rice merchant, who asked to remain unidentified as they are not authorised to speak to media.

While fertiliser shortages and dryness are already curbing yields of smaller crops being harvested in Southeast Asia, the next crop will likely face a bigger reduction.

India, Thailand and the Philippines plant their main crops in June and July, while Vietnam and Indonesia are now sowing their second-season crops.

Most Asian producers grow two or three rice crops a year.

Farmers cut planting

Sripai Kaew-Eam, a 60-year-old farmer in Thailand's Chai Nat province about 151 km (94 miles) north of Bangkok, said high fertiliser and fuel prices have pushed production costs to about 6,000 baht ($183.99) per rai (0.4 acre), from around 4,500 to 5,000 baht for the previous crop, while the price she receives for the unhusked rice she harvests is about 6,200 baht per metric ton.

Fertiliser prices have risen to 1,000 to 1,200 baht per bag, from 850 baht, forcing her to cut her use by half.

"Fertiliser prices are high, fuel prices are high," she said.

The Philippines, the world's biggest rice importer, faces a similar situation.

"Some farmers are now saying they may not plant or will reduce fertiliser use, which would inevitably cut production," said Arze Glipo, executive director of the Integrated Rural Development Foundation.

The country's output could fall by as much as 6 million tons from its typical 19 million to 20 million.

"That would leave the Philippines in a precarious position, as imports are also uncertain due to export restrictions, making it extremely difficult to cover any production shortfall," Glipo said.

In Indonesia, fertiliser supply is not a constraint but the El Nino is expected to curb output.

Indonesia's statistics bureau estimates the rice harvest area in the March to May period will shrink by 10.6% to 3.85 million hectares (9.5 million acres), while unhusked rice production will drop 11.12% to 20.68 million tons.

Despite the supply worries, the world has ample rice inventories following years of bumper output, with India, the world's biggest exporter, holding a record 42 million tons or about one-fifth of global stockpiles, according to US Department of Agriculture data, cushioning any drop in global production.

Most rice grade prices are currently steady but will likely rise even if the Hormuz situation were resolved immediately, the FAO's Torero said.

Opening the strait soon would avoid a major supply issue but "if we don't reopen this in the next two to three weeks, the situation is going to get pretty serious," he said.